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Technology Stocks : Ascend Communications (ASND)

ASND 200.28

-1.0%

Dec 3 3:59 PM EST

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To: Scott who wrote (13326)	9/17/1997 7:50:00 PM
From: Kevin Kessel	of 61433

TO ALL: RE NTT CONTRACT This contract is NOT any surprise to anybody who has followed this stock. However, the Public Confirmation is VERY good news for Ascend. This contract was first reported by two sources on 8/19/97. They were Joe Noel of H&Q and Joe Bellace of Merrill Lynch. Of course, back then the contract was just a "rumor". It was not confirmed until today or last night if you will. Back on 8/19, Noel called it the "Biggest-Ever Frame Relay Contract". He went on to point out that "Ascend will now supply the largest Internet backbone in the two largest economies in the world". Back then Acsend declined to confirm or deny the contract with NTT, saying only it "wasn't public information". Noel did not allude to the size of the contract. However, he did say that Cisco competed for the contract and that it was "equally significant that Cisco didn't win this one." That day the "rumor" pushed the stock up 1 3/4 to 46 5/8. I GOT THIS ARTICLE off of a bloomberg, if you want you can ask your broker for a copy. You also may be able to get if off their website (I haven't looked yet). Bellace said it was " a multi-year contract with a potential value of SEVERAL HUNDRED MILLION DOLLARS." He also went on to say that he "expects this contract to contribute MODEST REVENUE in the SEPTEMBER quarter." If you have an account at Merrill you should be able to get a copy of this Aug 19th report. It is my feeling that this contract is very good news for Ascend. The fact that it has been confirmed quells a lot of fears that some might have previously had regarding Ascend possibly lossing it. It also shows me that Cascade's business is doing very well and that the merger will have a very postive LONG term effect on Ascend. Now, the only uncertainty that remains is in this Q3. If this contract won't contribute much to revenue, then it really doesn't change the negative outlook for making this Q. However, it does help to solidify Q4 and going forward into 1998. Kevin

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